Two years ago, Oman and its state-owned petrochemicals group OQ (Sohar; www.oq.com) launched the Labayn incentive programme a scheme designed to encourage plastics processing companies to set up operations in the Gulf state. The initiative appears to be bearing fruit. So far, 18 companies from Europe, the Middle East, India, China, and Southeast Asia have committed to investing, said Abdul Rahman Al-Tamtami, OQs vice-president of global marketing, speaking at a press conference in Rotterdam in the Netherlands.

These pledges represent direct investments totalling USD 160 mn (EUR 140 mn) and are expected to create over 600 jobs. Four companies, which together have invested USD 54 mn, are reportedly set to begin production during the current year. Al-Tamtami did not disclose specific company names, nor did he provide details on the size of the governments subsidy fund. However, he noted that OQ is currently in talks with firms from Brazil, with further discussions planned with plastics processors from other countries across the Americas.

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By encouraging the establishment of plastics processing firms, Oman aims to address a major imbalance. Although the country, home to nearly 5 mn people, has considerable polymer production capacity around 1.2 mn t/y of polyethylene, 1 mn t/y of PP, and 1 mn t/y of PET, according to PIEs Polyglobe database it still imports almost all of its finished plastic products. At present, around 90% of the nations petrochemical output is exported, Al-Tamtami reported.

OQ sees its role in attracting foreign investment as that of a facilitator and enabler. We act as a kind of concierge, Al-Tamtami explained. Oman is looking to capitalise on its low energy and feedstock costs, as well as its strategic geographic location positioned between Europe and Africa on one side and Asia on the other. The country, which refers to itself as the Switzerland of Arabia, also considers its high levels of safety and order a key advantage. In addition, Al-Tamtami noted that OQ has expanded its polypropylene offering to include grades suitable for the production of thin-walled food packaging.